Finance Committee on May 26th, 2015

[The Chair, Conservative, James Rajotte]

Thank you.

I just want to follow up on division 6. I'm very pleased this was in the budget and in this BIA. This is one of the items recommended by Engineers Without Borders, and I was very pleased to see some of the work they were doing in Ghana last summer.

Perhaps I could get officials who are on this division to talk about the need for balancing the provision of financing with poverty reduction goals. One of the concerns is how you ensure you are providing development finance. EDC obviously has a trade mandate. How do you ensure that you are also addressing poverty reduction?

Mr. Bertin, please.

[Marc-Yves Bertin]

Thank you for that question.

It's fair to say that while official development assistance has done a tremendous amount of positive work, or has worked positively internationally for the past four years, there is a growing recognition, a consensus internationally, that post-2015 objectives, the objectives the international community is trying to negotiate at this time, will need more resources than official development assistance. Within that context, countries, including developing countries, have increased the focus on foreign direct investment as a source of funding for growth and development. Within that context, a number of donors have already acted to optimize their contribution to this space.

Canada doesn't have a DFI, development finance institution. Other G-7 countries have DFIs, and what the DFIs ostensibly do is they operate in the space where the private sector currently isn't. What I mean by that is they occupy a space where the perceived risks might be too great for the private sector. Therefore, from that perspective, the DFIs will entertain initiatives as long as there is a development outcome as well as a viable project on the table.

Within that context, this initiative will occupy specific space that is complementary and additional to official development assistance. Official development assistance will continue to work on establishing a good governance context, promoting sustainable economic growth in areas where there are market failures or an inability for the private sector to play; whereas this will present an opportunity for the government to partner with the private sector on ventures that yield a development outcome but are also viable enterprises or projects unto themselves.

[The Chair, Conservative, James Rajotte]

Will the resources provided under this type of initiative be considered part of Canada's eligible official development assistance?

[Marc-Yves Bertin]

DFIs offer customized commercial tools such as loans, guarantees, and equity stakes to respond to the specific financing challenges of the private sector in developing countries. Typically, these types of investments are not covered by the international rules set by the OECD DAC in terms of what constitutes official development assistance. While the DFI investments would not technically be ODA, they would nonetheless be guided by...and the initiative would have the opportunity as it stood up to examine international best practices that are out there, including domestic norms, to ensure the conduct of the initiative meets the highest standards, both financial as well as corporate social responsibility.

[The Chair, Conservative, James Rajotte]

Thank you. We appreciate that.

There's about one minute left in this round, Mr. Van Kesteren.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

I have just as a quick follow-up on DFIs. Which countries are practising that at this time?

[Marc-Yves Bertin]

I'm sorry?

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Can you give me an example of some of the countries that are practising the DFIs?

[Marc-Yves Bertin]

Countries that have DFIs? All G-7 countries have DFIs, for example. We're the odd man out, if you will. There are a few other countries beyond the G-7 that have them.

[The Chair, Conservative, James Rajotte]

Thank you.

Monsieur Dionne Labelle.

[Pierre Dionne Labelle, NDP, Rivière-du-Nord, QC]

I want to go back to division 7, which amends the Canada Labour Code.

It contains three new articles relating to interns. I don't see why there should be three new articles when we could simply broaden the provisions of part III to protect anyone carrying out activities for federal employers. Why not simply broaden the existing provisions?

[Charles-Philippe Rochon, Assistant Director, Labour Law Analysis, Department of Employment and Social Development]

Thank you for your question.

One of the difficulties with part III is the fact that it sets a number of labour standards relating to a person who receives a salary, whether it involves vacation pay, compensation for stat holidays, overtime and so on.

Because of how part III is structured, it would have been difficult to simply extend all the protections, for example to unpaid interns, because some of these protections would not make sense at that time. It would be impossible for employers to respect these provisions.

The decision was made to adopt a bit of a different approach. It aims mainly to improve protection for everyone, but it recognizes that there are very different circumstances for interns. That is how we improved protections while avoiding more confusion.

[Pierre Dionne Labelle, NDP, Rivière-du-Nord, QC]

Thank you.

I would like to talk about the federal balanced budget act.

In the case of a projected deficit or in an exceptional situation, government employees' salaries are frozen. But who decides when this exceptional situation is over? What criteria or what figures would lead the government to decide that the exceptional situation that required the salaries of those people to be frozen has ended?

[Brad Recker]

There are two situations. There could be a recession or an extraordinary circumstance, in fact. In the case of a recession, the proposed act indicates that the recession ends when Statistics Canada reports the second quarter of economic growth. In the case of an extraordinary circumstance, this ends at the time the public accounts are tabled, which shows the impact of that extraordinary circumstance, which needs to be greater than $3 billion.

[Pierre Dionne Labelle, NDP, Rivière-du-Nord, QC]

I see that over time, in other governments, at the provincial or other levels, the balanced budget legislation is more or less followed in the end. A situation can always be described as exceptional in order to apply the legislation or not.

[Brad Recker]

No. In fact, the legislation lists specifically the—

[Pierre Dionne Labelle, NDP, Rivière-du-Nord, QC]

Provincial legislation has often been amended and repealed. Do you agree with me on that?

[Brad Recker]

It's true.

[Pierre Dionne Labelle, NDP, Rivière-du-Nord, QC]

That's true. Okay.

[The Chair, Conservative, James Rajotte]

Colleagues, we have 15 minutes. If members want to continue with this group of officials, it's fine, but if you want to question the next group, then we're going to have to move on.

[An hon. member]

Go to the next group.

[The Chair, Conservative, James Rajotte]

I'm sensing there's consensus for the next group, so we'll thank this group of officials. Thank you so much for being with us today.

We'll bring forward the officials for part 3, divisions 18 and 20. Division 18 deals with the Ending the Long-gun Registry Act, and division 20 is sick leave and disability programs.

We have officials from Public Safety and from Treasury Board. Welcome to the committee.

Perhaps I'd ask one official from Public Safety and one official from Treasury Board to give a brief overview of these two divisions.

We'll start with Public Safety. Mr. Potter, would you be doing that?

[Mark Potter, Director General, Policing Policy Directorate, Law Enforcement and Policing Branch, Department of Public Safety and Emergency Preparedness]

Good morning.

Many of you will recall that in October 2011, the ending the long-gun registry bill was introduced in the House. In April 2012, the Ending the Long-gun Registry Act came into force. That act had two primary objectives. The first was to end the registration of long guns in Canada. The second was to destroy the long-gun registry data. The second objective of destroying the data is primarily to respect the privacy rights of Canadians who had registered their long guns.

The amendments in the budget implementation act are intended to comprehensively address that second objective by ensuring that no other act of Parliament, including the Access to Information Act, would compromise that key objective of destroying the data. Put simply, the amendments to the budget implementation act address a gap in the original Ending the Long-gun Registry Act.

Thank you.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Potter.

For Treasury Board, Ms. Kolk, go ahead, please.

[Bayla Kolk, Assistant Deputy Minister, Pensions and Benefits Sector, Treasury Board Secretariat]

Thank you and good morning, Mr. Chair and committee.

As stated in budget 2015, the government will make every effort to reach agreement with bargaining agents within a reasonable timeframe on necessary reforms to disability and sick leave management.

A new round of collective bargaining between the Government of Canada and the federal public service bargaining agents began in 2014 to renew the government's collective agreements. The government's overarching goal in these negotiations is to reach agreements that are fair and reasonable for both employees and taxpayers. The negotiations held today reflect the government's commitment to good faith collective bargaining.

The government's priority in these negotiations continues to be to provide for a disability and sick leave management system that is modern, comprehensive, and responsive to employees needs. The government's outdated existing system of bankable sick days is failing both employees and taxpayers. For example, over 60% of employees in the core public administration do not have enough banked sick leave to cover a full period of short-term disability.

Twenty-five per cent of our employees have fewer than 10 days of banked sick leave. Many employees, especially new and younger employees, have no banked sick leave at all. In contrast, long-tenured individuals, including many executives, have far more banked sick days than they will ever reasonably need.

The government will continue to make every effort to negotiate and to reach agreement with bargaining agents within a reasonable timeframe on necessary reforms to disability and sick leave management. The government continues to negotiate with bargaining agents to identify mutually acceptable design parameters for the new system and is prepared to consider reasonable improvements to its tabled proposals.

In the event that agreement cannot be reached, the government will take steps required to implement a modernized disability and sick leave management system within a reasonable timeframe.

Under the Financial Administration Act, the Treasury Board may establish terms and conditions of employment for public service employees, including those respecting sick leave, and may modify any group insurance or other benefit program for employees.

In accordance with requirements under the Public Service Labour Relations Act, the government is bargaining in good faith and is proposing changes to the terms and conditions of employee sick leave as well as the introduction of a new short-term disability plan.

The government believes in the bargaining process and is committed to making every effort to reach a negotiated settlement.

Under the proposed legislation, the government—